Bitcoin’s Price Falls Sharply, Bitcoin Cash Surges
- Bitcoin drops around $3,000 since BTC futures were launched on the CME.
- Bitcoin Cash doubles in value this week on transaction issues and Coinbase support.
- Altcoins give back some of their recent gains but remain supported.
Bitcoin Futures Point to Lower Prices Ahead
This week’s launch of Bitcoin futures on the Chicago Mercantile Exchange (CME) has done little to calm the recent volatility in the price of BTC with prices in the cash market trading in a $4,000 range in the last three days. While the opening CME futures price pointed to prices in excess of $20,000 early next year, the January 2018 contract traded as low as $16,435 Wednesday. Bitcoin futures are a legal agreement to buy or sell BTC’s at a predetermined price on a specific date in the future.
In contrast, the price of Bitcoin Cash (BCH) has doubled this week on news that the original Bitcoin network is becoming increasingly difficult to use due to slow transaction speeds and high transaction costs. The original Bitcoin network has a block size of 1MB while the Bitcoin Cash network has a block size of 8MB, making transactions quicker and fees cheaper.
Bitcoin Cash also received a boost when Coinbase, one of the world’s largest cryptocurrency exchanges, said that it would support the coin. This announcement caused sharp market moves and the company is now investigating the price spikes for any evidence if employees violated the company’s trading policies.
Bitcoin Cash vs Bitcoin Chart – Four Hour Timeframe (December 5 – December 20, 2017)
Controversial SegWit2x Fork Back in the Spotlight
The original SegWit2x hard fork was pulled in November this year after the Bitcoin community lacked consensus on the split. The 2x fork was supposed to double the block size on the chain to 2MB and change other protocols. Now the SegWit2x project has said that it will carry out this hard fork when block 501451 is reached on the chain, an event that is anticipated to happen on December 28.
And as well as the new fork producing a new, free, coin (B2X) for holders of Bitcoin on a 1:1 ratio, the project developers have also said that BTC holders will receive a ‘proportional number of Satoshi Nakamoto’s Bitcoins as a reward for their commitment to progress.'
Altcoins Drift Lower but Remain in Record High Territory
The last couple of weeks have seen a variety of altcoins soar to record highs as investors diversify away from the market heavyweights. These moves have fueled yet more talk of a ‘Cryptocurrency Bubble’ as cynics question the extreme valuations given to these new companies.
Among the recent altcoin ICOs that have made headlines, IOTA (IOTA) is currently up 490% on the month at $5.32, Ripple (XRP) is up 250% in the same time frame at $0.77 while Cardano (ADA) is up a staggering 1800% at $0.498, giving the nascent company a market valuation of nearly $13 billion.
Cryptocurrency Prices and Valuations – December 20, 2017
--- Written by Nick Cawley, Analyst.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.